Macau Gaming Stocks - March 2008, Q1 2008
Well, its time again for our monthly (and quarterly) review of the the Macau gaming stock market sector.
Macau gaming stocks trended every so slightly downward for the whole month, despite a number of ups and downs specific companies had. The biggest loser of the month is Las Vegas Sands, which declined nearly 10%. LVS, second to SJM, seem to be the most affected as the VIP sector moves to Crown Macau and MGM Grand Macau.
Mid month, investors sold off a lot of gaming business stocks, which affected nearly everyone except WYNN which steadily trended upwards before losing 8% during the last 10 days of the month.
MPEL had the largest jump - bouncing about 13% in the first two weeks of the month, before the entire sector except WYNN, had a selling spree.
MGM and Galaxy (0027HK) also had some ups (MGM) and downs (Galaxy) before ending the month just a shade below even.
The Q1 chart looks about as complex as Macau's pawnshops' neon signs. Only MPEL and WYNN seemed to survive the overall downturn, with both companies lofting to nearly 15% gains during the quarter. Galaxy, LVS and MGM all lost over 20% of their stock price, with MGM and LVS almost dropping 1/3. Wow.
MPEL was the overall winner, with lots of investors jumping in at the $8.50 price point in mid-January and doing some shorting two weeks later as the stock hit the $12 range. Another drop, rise and sell-off occurred in early March as MPEL hit $13, sending the stock down to $11.21 on March 4th. MPEL has been a steady grower though despite it still being quite a bit undervalued currently. Over the entire Quarter, MPEL ended essentially where it started, but astute investors who bought in during the valleys probably paid off some of their losses from IPO purchases during the peaks. It remains to be seen when or if MPEL is going to have a barn burning session. Despite the economic situation in the US growing bleaker by the month, MPEL has held steady, which is quite a victory if you look at the rest of the sectors performance.
With a quarter that was marked by an overall decline, significant opportunities for riding the rails are plentiful. Galaxy has become more vocal about its plans and timetables for the Cotai MegaResort, eSun's Macao Studio City has aligned more financing and poached Sands Macao' SVP of Operations Walter Power (who build the Sands Macao) to its CEO post, and MPEL's VIP deal at Crown Macau coupled with City of Dreams topping out and tentative March 09 opening all shine a light on potential growth for each of the companies.
Disclosure/Disclaimer: I do not hold any gaming business stocks, or any stocks whatsoever other than some 401k stuff from a former employer (IACI). This information is presented purely for your interest and entertainment.